US Judge Greenlights a Lawsuit Against Ripple Labs in California

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A judge in a United States federal court has approved a lawsuit against Ripple Labs alleging their CEO violated California securities laws.

The decision, made by Judge Phyllis Hamilton on June 20, means that a jury will be responsible for determining whether Ripple CEO Brad Garlinghouse made misleading statements during a 2017 interview.

The judge dismissed four claims of failure to register XRP as a security, but allowed one individual state law claim to move forward to trial. Ripple’s Chief Legal Officer Stu Alderoty stated that they are pleased with the court’s dismissal of the class action claims and will address the remaining claim in trial.

Judge Hamilton acknowledged that Ripple had argued for the dismissal of the misleading statement claim, citing a previous ruling by Judge Analisa Torres in a Securities and Exchange Commission lawsuit stating that XRP is not a security under the Howey test.